Real Estate "Flash Sales" Are A Seller's New Best Friend
Don't blink when you see that real estate listing for the perfect new home. Because it might vanish in the time it takes you to write the open house on the calendar.
There's this fantastic little neighborhood in San Francisco called "Little Hollywood." It's off the beaten track and far from the most sought-after neighborhoods, like the Marina and Pacific Heights – closer to the Bayview and the city dump, if you really want to know the truth. But it's on the southeast sunny side of San Francisco, in up-and-coming Visitacion Valley, and the architecture is to die for: pastel-hued '20s-era homes originally built for L.A.-based actors like Mae West who wanted a NorCal pied-a-terre, or so the local lore goes.
I was thrilled when my email alert pinged to tell me a listing was available there. A drive-by told me it was perfect: big enough for my family, atop a hill with a great view, near shops, and it was even pink. I was over the moon, and set about revamping our financial plans in anticipation of the open house that Sunday.
But that open house never came. Within a day, before the listing was even updated with photos, the house was sold – gone. Way over asking, too. I never had a chance.
The pros are calling these "real estate flash sales." They're not quite off-market – those are sales done without the home even being listed with an agency, completely privately – but they are the result of a pre-emptive offer. A big, fat one.
"This is absolutely a trend, more than ever with the scarcity of property we're seeing," says Darwin Tejada, a top producer at McGuire Real Estate for more than 20 years. "It's increasingly common to see a property come on the market on Wednesday, ratified on Friday, and it doesn't make it to the first open house."
What FrontDoor wanted to know was this: Why would a seller bother with a pre-emptive sale this quick if they had the chance to start a bidding war? What makes an offer so good that you wouldn't even entertain other possibilities?
"Every seller has a unique situation, and there are many reasons someone might need to expedite the sale: Maybe they are elderly, they're ill, they don't have the up-front money for staging," he says. "Or maybe they've had a bid accepted and need to move in a hurry. The bottom line is, this is probably an all-cash offer with no contingencies, and the seller avoids a lot of red tape and negotiation."
Of course, this kind of thing does come with risk. The buyer takes the brunt of it, but with inventory so low, the buyer is taking all sorts of risks to get an edge. The seller risks missing out on an even bigger offer, boo hoo.
So how can a buyer get in on a flash sale? There's not much to it other than being ready to leap at every opportunity and watching the listings like they're Lindsay Lohan and you're the paparazzi. Take it from a weary recent homebuyer: After a few months in this market, the idea of making an offer sight unseen gets less and less weird with each rejected bid.